Consumer Protection for Vehicle Buyers Strengthened

Surrey – The Government of British Columbia is strengthening consumer law to increase the protections for motor vehicle buyers. Today, the Government passed regulations to fully enact amendments to the Motor Dealer Act. A majority of the amendments come into effect January 1, 2018, with all the amendments in full force by April 1, 2018. Building on the current professionalism of the vehicle sales industry, the regulations add even more certainty for consumers when purchasing a vehicle.

Used vehicle wholesalers will now be regulated and licensed under the Act. As an unlicensed group, wholesalers were not legally bound to disclose vehicle histories when selling vehicles to dealers. The licensing of wholesalers is a further step to improving the accuracy of disclosures to consumers.

Broker agents, who offer to act on behalf of a consumer when purchasing a vehicle, will also be licensed and regulated. Previously, there was no prohibition for broker agents receiving money from both the buyer and seller. This dual agency or double ending put them in a position of conflict and is now prohibited.

The amendments remove longstanding gaps in consumer protection created by the licensing of just motor dealers and salespeople.

Additional consumer protection enhancements and authority

Flexible, proportionate and responsive approaches to breaches of the Motor Dealer Act by licensed dealers and salespeople have been added. Administrative penalties, compliance orders and undertakings will provide administrative flexibility beyond the current option to simply suspend or revoke licenses. These new tools will also be available to battle unlicensed activity, such as curbing.

The establishment of a Consumer Advancement Fund for all administrative penalties assessed under the Motor Dealer Act. Penalties from contraventions of the Business Practices and Consumer Protection Act will also be added to this fund and used only for consumer education.

Oversight for the Customer Compensation Fund becomes the responsibility of the Vehicle Sales Authority. The VSA currently manages all aspects of the compensation process except this oversight.

The authorization for the establishment of a code of professional conduct for motor dealers and salespeople to further support a responsible and professional vehicle sales industry.

The use of electronic communications and paper hearings, in addition to oral hearings, in the processing and adjudication of some complaints. This will increase the speed and accessibility of complaint adjudication.

The right of reconsideration for compliance orders and administrative penalties as a way to add fairness.

Mike Farnworth, Minister of Public Safety and Solicitor General affirmed,People in B.C. are right to expect a fair deal when they buy a vehicle through a dealer or broker – and the industry agrees with us on that. The changes we’re making today will mean that the Vehicle Sales Authority, which regulates the industry, can impose incremental penalties on dealers who break the rules, and in turn, use these fines to help better educate salespeople and buyers about their responsibilities and rights.

Jay Chambers, President of the Vehicle Sales Authority, summarized the changes as follows,This important consumer protection legislation expands existing authorities by increasing the scope of current protections to previously unlicensed areas while enhancing other powers to add fairness, accessibility and efficiency.

Ian Christman, Registrar of Motor Dealers confirmed,Consumers are entitled to protection and to peace of mind when buying a motor vehicle. This includes being able to hold any person who is in the motor vehicle “supply chain” accountable if they have knowledge about a car’s history and may influence the purchasing decision of a consumer. They are required to relay truthful and accurate information, act honestly and with proper disclosures and not take advantage of a consumer’s ignorance or other frailties.